Over the past three years, U.S. equities have delivered consecutive double‑digit gains, a streak that has drawn fresh optimism from investors. Bank of America’s latest poll shows a record share of fund managers now classifying themselves as overweight stocks, a shift not seen since the 2022 bull wave. This mood change follows a backdrop of rising oil prices, inflation expectations, and bond yields.

Rob Griffiths of Legal & General examined historical data from 1871 to 2023 and identified 17 occasions where three successive calendar years produced double‑digit total returns. In 12 of those cases, the fourth year remained positive, averaging 11.2%. Since 1945, the pattern holds but the average drops to 3.3%, well below the long‑run 9.0% figure.

When returns are adjusted for inflation, the pre‑1946 bar counts shrink, but the post‑war pattern persists. Across 14 instances of three consecutive double‑digit real returns, nine were followed by a nominal gain. The data suggest that a streak alone does not guarantee a sustained rally, challenging the notion that a fourth year must be a “sell” signal.

Given the recent poll shift and historical context, market observers now view the bull capitulation as nearly complete. Michael Harnett of Bank of America predicts that early June could prove a ripe window for profit‑taking, as investors weigh the limits of continued double‑digit performance.